The White House – On Tuesday, the White House is highlighting new efforts to help lower American’s daily costs.
The White House efforts come before the latest Consumer Price Index report is released.
The new steps aim to lower out-of-pocket costs as broad economic concerns and the possibility of a recession linger.
The measures
According to a White House official, the new measures are aimed at lowering the price of the following:
- Health care
- Home heating
- Broadband access
The White House official also said the efforts would impact tens of millions of families, seniors, and students month-over-month.
The new steps result from critical legislative efforts President Joe Biden signed since becoming president.
Broadband access
According to the White House official, the Federal Communications Commission will release funds to support the Affordable Connectivity Program this week.
The program is a provision of the bipartisan infrastructure law.
It provides eligible households with one of the two following:
- A $30 monthly credit toward the cost of their internet service plan
- A $75 monthly credit for families living on Tribal land
The program assists in the delivery of affordable broadband to around 16 million households.
Energy
The Department of Health and Human Services is releasing around half a billion dollars in Low Income Home Energy Assistance Program funds to states, covering American families’ home heating costs.
Last November, the Biden administration announced they would distribute $4.5 billion in federal assistance to lessen the heating bills for Americans through the program.
It also received an extra half billion in funding through the infrastructure law.
According to the White House official, the program has been impactful, helping around 5.3 million households with heating and cooling bills and weatherization services in the past year.
Health
The Department of Health and Human Services is also announcing details on which Medicare Part B drugs increased their prices faster than inflation after the Inflation Reduction Act went into effect.
The drugs will be subject to inflation rebates for excessive price increases.
According to the White House official, some beneficiaries will also see lower copays starting next month.
The Health and Human Services will also release new data to show how many seniors and people with disabilities will likely have started seeing cost-savings on recommended vaccines free of charge due to a provision of the Inflation Reduction Act that went into effect in January.
Read also: Stocks drop following a volatile February
CPI report
The announcement regarding the Biden administration’s next steps comes ahead of the CPI report released Tuesday morning.
The February CPI release indicated that inflation surged in January at the peak in three months, showing an increase of 0.5%.
Regardless, inflation still slowed on a year-over-year basis to around 6.4%.
However, regression concerns still linger over the US economy.
The fears recently heightened after releasing a hotter-than-anticipated jobs report and the second-largest failure of a financial establishment in US history.
Throughout 2022, the Federal Reserve undertook several interest rate hikes targeting chilling demand and cooling high inflation.
The February net job gains exceeded economists’ projections for a modest month, showing resistance to the Fed’s interest rate hikes.
Silicon Valley Bank collapse
The Federal Reserve’s campaign has been scrutinized due to the collapse of Silicon Valley Bank.
SVB financed nearly half of all US venture-backed tech, health care, and crypto companies.
The rate hikes played a role in the bank’s collapse late last week in two aspects:
- Higher borrowing costs rocked the shallow parts of the US economy, especially the tech industry
- The hikes undermined the value of the Treasury bonds banks typically rely on as a central source of capital
Before the collapse, investors were preparing for a major interest rate hike of half a percentage point over the next week’s Fed meeting.
However, former chair of the Federal Deposit Insurance Corporation Sheila Bair said a hike of such size is ill-advised due to the bank’s collapse.
On late Sunday, Goldman Sachs told clients that the bank isn’t expecting the Feds to deliver a rate hike next week.
On Monday, President Biden attempted to quell concerns, touting his administration’s efforts to protect small businesses and workers after the bank shut down.
The actions include backstopping depositors’ funds at Signature Bank and SVB, refusing to extend relief to SVB investors and holding the people responsible accountable.
“Americans can rest assured that our banking system is safe. Your deposits are safe,” said Biden.
“Let me also assure you we will not stop at this. We will do whatever is needed on top of all this.”
Image source: Washington Post
